The
above-entitled matter comes before the Court upon the Report
and Recommendation of United States Magistrate Judge Franklin
L. Noel dated September 8, 2017. Defendant Timothy Wayne
Guthman filed objections to the Report and Recommendation.

Pursuant
to statute, the Court has conducted a de novo review
upon the record. 28 U.S.C. § 636(b)(1); Local Rule
72.2(b). Based upon that review, the Court
ADOPTS the Report and Recommendation of
United States Magistrate Judge Noel dated September 8, 2017.

The
Court further provides:

An indictment is sufficient if it contains the elements of
the offense charged, lets the defendant know what he needs to
do to defend himself, and would allow him to plead a former
acquittal or conviction if he were charged with a similar
offense. Usually an indictment that tracks the statutory
language is sufficient.

The
Indictment in this case meets the aforementioned standard for
the charged conspiracy offenses. The Court further notes that
the charges in this case are based not only on a theory that
a chiropractor commits fraud by billing an insurance company
for noncompensable claims based on services provided to a
patient who was brought to the clinic through a kickback
payment to a runner, but also on allegations that the
chiropractor billed the insurance company for treatments that
were not medically necessary and for services not actually
provided. (Indictment ¶¶ 1, 4-5, 12, 14-15.) The
Indictment asserts that all of these allegations were part of
a scheme to defraud insurance companies.

Moreover,
as the Eighth Circuit Jury Instructions for the underlying
substantive offenses recognize, more than one theory of a
scheme to defraud may be presented to the jury. See
Eighth Circuit Manual of Model Jury Instructions (Criminal)
(2014) §§ 6.18.1341 n.2, 6.18.1347 n.3. The Court
further notes that the charges in the Indictment are, in
fact, conspiracy counts under 18 U.S.C. § 1349.
“[A] conspiracy conviction under § 1349 does not
require proof of an overt act.” United States v.
Roy, 783 F.3d 418, 420 (2d Cir. 2015). See also
Eighth Circuit Manual of Model Jury Instructions (Criminal)
(2014) § 5.06A-1 n.2.

Furthermore,
“under the No-Fault Act, insurance companies have a
right to deny paying benefits based on grounds other than the
necessity and reasonableness of the medical treatment.”
Liberty Mut. Fire Ins. Co. v. Acute Care Chiropractic
Clinic P.A., 88 F.Supp.3d 985, 1008 (D. Minn. 2015).
See also United States v. Gabinskaya, 829 F.3d 127,
133-34 (2d Cir. 2016) (upholding convictions for conspiracy
to commit mail fraud and conspiracy to commit health care
fraud, among other offenses, based on physician conspiring to
submit claims to no-fault automobile insurance companies that
were ineligible for payment under New York law because the
physician was not the actual owner of the clinic). A claim
can be fraudulent based on the withholding of a material fact
from the insurance company, even when that material fact does
not implicate medical necessity. Thus, if a claim is
ineligible for compensation due to violation of the runner
statute, that fact could be material to an insurance company.
See Minn. Stat. § 609.612, subd. 2. Here, the
Government has adequately alleged that the existence of
kickback payments to runners is a material fact to insurance
companies.

United
States v. Jain, 93 F.3d 436 (8th Cir. 1996), is
inapposite because, there, the alleged victims of the mail
fraud were the patients and there was no evidence of harm;
here, the Government alleges that the automobile insurance
companies were the victims, that the victims were billed for
services that were not medically necessary or were not
provided, and that the non-disclosure of the runner payments
was a “material fact” to those insurance
companies (Indictment ¶ 16). Finally, Illinois
Farmers Ins. Co. v. Mobile Diagnostic Imaging, Inc., No.
13-CV-2820 (PJS/TNL), 2014 WL 4104789, at *9-10 (D. Minn.
Aug. 19, 2014), did not address the runner statute, and
Illinois Farmers Ins. Co. v. Guthman, No. CV
17-270(RHK/SER), 2017 WL 3971867, at *6 (D. Minn. Sept. 7,
2017), addressed a civil complaint in which the plaintiffs
failed to allege that “the runners were aware of the
scheme” and, so, concluded that the complaint failed to
“plausibly allege that the runners knowingly
participated in a scheme to defraud.”

Accordingly,
based upon the files, records, and proceedings
herein, IT IS HEREBY ORDERED:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The
Court ADOPTS the Report and Recommendation
of United States Magistrate Judge Franklin L. Noel ...

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